Visiting the Caribbean: U.S. economic woes put a dent in traffic

Ana Ventura, an agent with Atlas Travel in Brooklyn, N.Y., used to book about 20 vacationers to the Caribbean every day as recently as a year ago. These days, she’s lucky to get 10 bookings. “I hope we can get more bookings soon, otherwise this summer won’t be a good one for us,” she says.

The U.S. dollar’s free fall against the euro, British pound, Canadian dollar and many other world currencies means American vacationers are struggling to find ways to make travel affordable. Adding to the pain are higher airfares due to rising fuel surcharges and airline taxes, at a time when most Americans are facing job losses and other economic hardships.

The plunge of the greenback is particularly bad for countries south of the border whose currencies are pegged to the U.S. dollar. Although there’s still no concrete data on the potential impact on the tourism-dependent Caribbean islands — which draw more than 50 percent of their visitors from the U.S. — Caribbean officials have moved fast to stem any losses by stepping up marketing of their sandy beaches and warm climate. Jamaica, for example, has been running a marketing campaign that has seen a 14-percent bump in European and Canadian tourists since January, according to the country’s ministry of tourism. The ministry is advertising heavily on U.S. cable and satellite television, as well as boosting the number of Jamaica-bound flights by the national airline, Air Jamaica.

Similar efforts by the Dominican Republic have led to a 9-percent, year-on-year increase in the number of visitors to the island during the first quarter of 2008. For the whole of last year, 3.9 million travelers went to the Dominican Republic. “We have increased investment in marketing and advertising in the United States,” says Lucien Echavarria, director of the Dominican Republic Tourism Board in New York City. “We’ll spend more money [on marketing] because we don’t want to be affected by the economic downturn and that’s why we are trying to get people to know what attractions we offer.”

As part of that marketing campaign, the Caribbean Hotel Association and the Caribbean Tourism Organization, a trade group representing governments across the region, have jointly organized the first tourism summit of its kind from June 21 to 24 in Washington, D.C. The summit will bring together international leaders from political, tourism and investment communities from more than 30 Caribbean islands and the U.S. Discussions will focus on ways to improve tourism marketing and investment.

Still, the situation is not that dire. The weakening U.S. dollar is enabling many European vacationers to spend time on the sunny beaches of Africa and the Caribbean. A tour-operator survey suggests that a significant switch to the Caribbean may already be under way, even among American vacationers who are priced out of European destinations.

Last year, the number of tourists to the Caribbean totaled 22.5 million, a 1.5 percent increase from 2006, many of them from Europe, says Hugh Riley, who handles marketing for the CHA and CTO. Cruise-ship passenger visits increased by 2 percent to 19.5 million passengers in the same period. Overall gross visitor expenditure increased by an estimated 6.7 percent to reach U.S. $27 billion and room occupancy rates increased by 1.7 percent to 65.8 percent in 2007, according to Smith Travel Research’s Caribbean Survey.

“Information that we have received from two of the largest agency suppliers for the region shows significantly higher levels of hotel room nights booked for vacations in the region than at the same time last year for the May to September period,” says Riley.

Apart from Europe, Caribbean tourism officials are looking to Asia, where countries such as India and China are growing at breakneck speed and where a rising number of wealthy individuals are looking for vacation destinations. “China is a new growing market for the Caribbean,” says Riley. “Many stakeholders in Caribbean tourism believe that opening up China to the U.S. will also benefit Caribbean destinations due to proximity.”